How Bad is Bankruptcy Really?

How Bad is Bankruptcy Really?

Filing for bankruptcy means telling the judge that you cannot pay off your debts. After this is done, the court checks your assets and liabilities then decides if you are eligible to have your debts cancelled or discharged. If it is seen that you have no means to pay back, they let you declare bankruptcy. When this is filed, you become immune to foreclosure on repossession of your property, home, or other wages. When this is successfully done, the people you legally owe have no right to collect money from you temporarily. Bankruptcy cases differ and the court can tell you to pay a few debts notwithstanding. It is safe to note that bankruptcy does not cover for student loans, child support, alimony, taxes, fines, and items purchased before filing for bankruptcy like boats, houses etc.

Filing bankruptcy is not such a great idea. For starters, the process is tasking. To file for bankruptcy, you will have to

  1. Create organized paperwork listing all the debts. Each debt has its own paperwork, you would have to get a legal group like ours to run you through the process. We have a bankruptcy attorney who specializes in helping you correct errors that can get your case dismissed.
  2. A financial coach will always be suggested for you because you would have to check other options before settling for filing for bankruptcy. It is okay to call the creditors and talk about reducing the interest rate. A financial coach would also suggest things like getting another job to you, moving into a smaller and more affordable apartment.
  3. Advantage Legal Group would always offer professional help to you, the case might leave you filing a Chapter 7 or Chapter 13 bankruptcy. As an individual, this would not be clear to you and our services will always be here to guide you.

You deserve financial freedom and we can help you understand your options. Bankruptcy can tell on your emotions because, once you file for one, it becomes a public domain. Your name and personal information become easily accessible to potential clients, employers, banks, businesses and all the details of your bankruptcy will be known.

Once bankruptcy is filed, you will not be able to take loans anymore, mortgage loans can take about four to five years to qualify. The only way you could get a new home is if you decided to pay in cash.

The good side to filing a bankruptcy is that you might be allowed to retain ownership of property. Even though a bankruptcy record stays in your file for about 7-8 years, once your dischargeable debts are paid off, your record becomes clear. You will be able to move forward and rebuild your credit. Bankruptcy is always the last option to pay off debt and stop creditors from harassing you with calls, letters, etc.

If you have questions about filing bankruptcy in Washington State including Bellevue, Redmond, Kirkland and Seattle, then its best to give the attorneys at Advantage Legal Group a call to discuss your financial situation.

 

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What Do You Lose if You Declare Bankruptcy?

What Do You Lose if You Declare Bankruptcy?

Before you finally go to the judge or court to file for bankruptcy, the major worry to have is what you stand to lose. It might be your house, property, a potential job, or client as the record of your bankruptcy is available to public access. Bankruptcy is the last resort when the debt starts to choke you and the creditors endlessly harass you with unwanted calls and letters. Filing for bankruptcy leaves you at a temporary discharge from the creditors but what does it do to your credit record? What do you stand to lose after the judge approves your case?

Losing your property depends on how well you understand chapter 7 and chapter 13 when filing a bankruptcy. Chapter 7 will require that you sell some of your assets to pay off a part of the debt. The law guarding chapter 7 can be better explained to you by one of our attorney lawyers at Advantage Legal Group. This is called the liquidation and some of your property would be taken with exemption to retirement accounts, car, and house. This also allows you to relieve your debt by surrendering some of the assets belonging to you. This is meant for people with limited incomes and that is why the property is not taken. Companies and individuals can file this, and the discharge takes about three to five months to be received.

Chapter 13 bankruptcy involves the court giving you a repayment plan which protects your property if you successfully complete this plan. When this payment is completed, and some creditors are laid off, the court discharges other bills like the credit card and medical bills. This allows you as a debtor to keep your property and catch up on missed mortgage and cars. Chapter 13 allows the individual to make monthly payments for three to five years. This will require you to sell off some property to pay off debts.

The bankruptcy rules differ from state to state and there are set limits for trustees and what you can keep are within these limits called personal bankruptcy exemptions. Being able to keep your property depends on the pay you make monthly to your creditor. You can always keep your property, but it does not stop you from always falling behind on credit cards. The decision to sell your house is personal and would not be blamed on the creditor. It is natural to worry about your family and house and what you need is a financial coach or legal group like Advantage Legal Groups for consultation and advice. To avoid such fear over losing your property, chapter 7 serves as the best option for immediate debt relief.

No one wants to lose their property as what we all need is financial freedom. Our help runs from businesses to individuals and families, this is the right time to contact us if you are in Washington state including Bellevue, Redmond, Kirkland, and Seattle. Let us assist you in a difficult time as this one.

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Will Bankruptcy Forgive Student Loans?

Will Bankruptcy Forgive Student Loans?

Will student loans ever be forgiven during bankruptcy? The answer is: PERHAPS! President Obama spoke to the Georgia Institute of Technology recently on March 10, saying that his administration is looking into the idea. He revealed that he’d ordered officials to look into whether or not making student loans forgivable during bankruptcy would be helpful to millions of Americans who are under the burden of severe student debt.

The White House has made a series of efforts to alleviate student debt in America and student loan forgiveness during bankruptcy is the latest. Currently, bankruptcy laws protect student debt by being wiped away by a bankruptcy filing. However, with the tremendous, crippling weight of student loans, lawmakers are seeking new, flexible ways to students from a future trajectory of financial hardship. The goal is to make college more affordable for young people so that once they graduate, they aren’t so burdened with debt that they can’t do anything else.

The WSJ offered the following numbers on U.S. student debts:

  • -In the last seven years, U.S. student debt has more than doubled.
  • -Almost 25% of current borrowers are behind on their payments.
  • – The average student loan debt nationwide is right below $30K.
  • -The government lends 90% of the national student debt.

In his speech, President Obama offered only a few first ideas and details of this effort. It wasn’t clear whether or not an eventual proposal would address only loans issued by the Federal Government, or would also somehow affect private loans as well, such as those issued by firms like Wells Fargo & Co. and the like.

Obviously, the president’s interest in changing bankruptcy law is still in its formative stages, but even if the White House did come up with a change, it would likely face huge opposition in the Republican-controlled Congress. As the WSJ also reports, it is still unclear how effective changing bankruptcy law would be in really helping borrowers anyway. They report that only 713 bankruptcy filings in 2014 were filed to seek student loan relief.

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Is Bankruptcy Right for You?

If you are facing financial challenges and considering bankruptcy in Bellevue, Seattle, or Washington State, watch the following video which has Bellevue Bankruptcy Attorney Jonathan Smith discussing bankruptcy in Seattle, Bellevue, and Washington State, specifically Chapter 7 Bankruptcy on King 5 New Day Show.

The first thing you should do if you are facing bankruptcy in Bellevue or Seattle in King County is contact bankruptcy attorney Jonathan Smith at Advantage Legal Group. We will take a look at your specific financial situation and discuss the best option for you. Jonathans has been practicing law in Bellevue and Seattle Washington for over 23 years. We’ve seen it all. The ups and downs. The 2008 financial crisis and economic downturn. We’ve been practicing Foreclosure Defense Law and are a Northwest leader in mortgage mediation and mortgage modification.

Give us a call if you are considering bankruptcy in Washington State so you can make an informed decision. Advantage Legal Group is a debt relief agency helping Bellevue and Seattle residents with bankruptcy, foreclosure defense, mortgage mediation, and mortgage modification for 23 years in the Northwest.

If you are facing foreclosure on your Bellevue or Seattle area home in Washington State, bankruptcy may or may not be the best option. As an experienced Foreclosure Defense Law Firm in Bellevue, Seattle, and Federal Way, WA.  Advantage Legal Group will ask you specific questions related to your unique financial situation. If you are behind on your mortgage payments or maybe you did a mortgage forbearance with your mortgage lender because of Covid-19 and you can’t make up the payments to get current. There are many circumstances where the better option for you may be mortgage mediation or mortgage modification.

Give us a call at 425-45209797 so we can help you make an informed decision on whether Chapter 7 Bankruptcy is the right decision for you.

Bellevue Bankruptcy Attorney Bellevue Washington Lawyer
Bellevue Bankruptcy Attorney Bellevue Washington Lawyer

Filing for Bankruptcy

Filing for Bankruptcy - When, How, & Why

Filing for Bankruptcy – When, How, & Why

Determining if you Qualify for Bankruptcy

Individuals file personal bankruptcy because there is financial relief needed and they seek a second start.  If you feel there is no way out of your debt troubles and these debt troubles are regular occurrences, filing bankruptcy may be your best option.

  • Debt troubles a regular occurrence
  • You fear to lose your home/facing home foreclosure
  • Wage garnishment has been assigned to paychecks
  • Laid off/ job problems
  • Medical crisis to your family
  • Creditor harassment
  • Recent divorce
  • Lawsuit pending

To Qualify for Bankruptcy there are steps you must take.

1)      Attend a court-approved financial counseling course

2)      Figure out if your monthly income is more or less than the median income in your state.

One way to Qualifying for the bankruptcy means test:

Current monthly income minus expenses

Times that by 60 to get your result

If your result is more than 25% = $10,000

Less than 25%=$6,000 or less

3400-2000= 1400

1400* 60 = 84000*.25 = 21000 (File for chapter 13)

3400-3000= 400

400*60=24000*.25 = 6000 (File for chapter 7)

3a)   If Income is more than median income then you can file a 5-year chapter 13 bankruptcy

3b)   If Income is less than median income then you can file a chapter 7 bankruptcy

4)   Get a discharge from your bankruptcy through an approved Credit Counseling Course.

A Chapter 7 bankruptcy or a Chapter 13 Bankruptcy can help you overcome problems.  Learn more about what filing a Bankruptcy can do to help you in Bankruptcy 101

If you are at risk of losing your home due to foreclosure, mortgage mediation and modification might be your best solution. Contact us anytime to learn more information about Western Washington mortgage mediation, the fairness act, and how to avoid foreclosure.

Related: What if I Can’t Make My Mortgage Payment?

Advantage Legal Group is a financial debt relief law firm based our of Bellevue and Federal Way Washington and provides legal, bankruptcy and foreclosure defense services throughout Western Washington including Bellevue, Seattle, Redmond, Kirkland, Sammamish, Issaquah, Bothell, Woodinville, Lynnwood, Everett, Renton, North Bend, Auburn, Kent, Covington, Tacoma, Olympia, Federal Way, Des Moines, Seatac, Burien, West Seattle, Edmonds, and Western Washington in King County, Snohomish County, and Pierce County.

Preventing Bankruptcies

Preventing Bankruptcies

We are in some unusual and unprecedented times right now but that doesn’t’ mean you can’t prepare and still have some time to plan.

People use the phrase “Practice good money management.”  However, what does this really mean?  Terms like impulse spending, realistic budgeting, and no high-risk investment are not part of the “good practice.”  Understanding what is good money management practices can help you in preventing bankruptcies.  Bankruptcy might be your only option but there are ways to prevent it.

How do you avoid impulse spending? 

  • Impulse spending is spending money on anything that is not a NEED.  Steps you can take to avoid impulse spending:
  • Cut up credit cards so you cannot use your credit.
  • Take your credit cards out of your wallet so you have time to think about a purchase you are going to make.
  • Ask yourself do I need this item or just want it.
  • Can I get this item somewhere else for less money?  Is an item available on Craigslist, E-bay, or a thrift store?
  • Discipline yourself to use credit only when you know you have money in the bank to pay off the total at the end of the month.
  • Tear up credit card offers.
  • Tear up credit card checks that your credit company sends in the mail.
  • If you have to use credit cards and you are not in a position to pay the total off at the end of the month pay more than the minimums.  If you can pay more than you put on the card that month.
    • Say you have$ 5000 in debt on a credit card and you bought $500 in stuff this month.  Pay $500 plus more when the bill comes.  This way you didn’t add anything to the card and if you did pay more then you are on your way to reducing the outstanding debt on the card.

What is Realistic Budgeting?

  • Write down what you pay each month for bills:  House payments, electricity, garbage, water, natural gas, home insurance, life insurance, medical insurance, car payment, cable, phone, internet, and whatever else is a reoccurring monthly expense.
    • Some expenses are every other month like garbage and natural gas.  Set aside an amount so that the total bill can be paid when it is due.  (If your natural gas bill is around 200 every other month set aside 100 on the month it is not due that will be used in the next month)
  • Budget for food, entertainment, gas, and misc. expenses
    • Know what your average spending is for food, entertainment, gas, and misc expenses.
    • Create a set amount (budget) for each category and stick to it.
      • This might take some collecting of receipts or writing down each purchase.
      • Some people have taken out money from their paycheck, put it in an envelope, and that is the money for food for the month.
      • Whatever will work for you, to stick to a set amount, and do it!

What are high- risk investments and how can I avoid them?     

  • Don’t incur debt with others who have questionable financial habits.
    • If they walk out on a debt your credit rating will be effected
    • Co-signing on loan is a high-risk investment – it might be helping a family or friend out but if anything happens to them, you are left holding the loan!
    • Interest-only loan payments are high-risk investments.  If you can only afford to make an interest-only home payment, then the house is out of your price range.

You may be looking at how to get out of debt and bankruptcy seems like the only way just remember these ideas so you will not have to file for bankruptcy again.  Contact advantagelegalgroup.com for more help.

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Will Bankruptcy Mean I Have to Give up My House?

Will Bankruptcy Mean I Have to Give up My House?

Will Bankruptcy Mean I Have to Give up My House? – A common question weighing on the minds of those who are still making mortgage payments on their home and facing bankruptcy is “will I have to give up my home?” The answer to this lies in understanding the options available to your unique situation. It is possible to keep your home when filing bankruptcy if you meet necessary requirements.

To protect your home during bankruptcy, be aware of how much equity you have in your home and how you can protect that equity. If you’re making mortgage payments, you may have a certain amount of equity that’s exempt. This means a creditor can’t NOT touch this amount to satisfy debts you owe. Every state has a specific level or amount of “homestead exemption” which allows homeowners protection against debtors.

This homestead exemption is protection at the state level. However, there may also be help available at the federal level. Sometimes, if your state allows it AND you qualify, you may be able to use both kinds of exemptions( the state and the federal). A good example would be that if your state exemption protects you up to a certain level, then the federal exemption, often referred to as a wild card exemption, can protect your remaining equity. You may also be pleasantly surprised to learn that there are other exemptions available for items such as household goods, jewelry, vehicles, retirement accounts, and other personal assets.

Take heart. In most cases, you will not lose your home or even your car for that matter as long as your equity is fully exempt. Even if your property is not fully exempt you may be able to keep it if you pay its non-exempt value to the creditors.

However, be aware that if you’ve ever put your home up as collateral for a debt, then that creditor has a “security interest” in your home that does not go away with bankruptcy. If you’re unable to pay that interest, this creditor can repossess your home during or after bankruptcy.

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How Quickly Can I Recover from a Bankruptcy?

How Quickly Can I Recover from a Bankruptcy?

Filing for bankruptcy is never an easy decision. If you are considering bankruptcy or if you have been through it, there is probably just one question on your mind: “How quickly can I recover from  bankruptcy?”

There are many factors that contribute to the time you will spend mending your credit. The first step you should take is to carefully examine what you have coming in each month from any source.  Tally up what you are obligated to spend for basic living. Then, get some help if you need it and create a workable cash flow budget that ensures that you can begin living within your means. Keep all of your receipts, especially those that show on-time payments.

Spend some time looking at all three of your scores from the major credit rating services. Look for any mistakes in balances owed or payment records. Correct any errors by challenging the incorrect reports and once you have set the record straight, continue to monitor these reports on a regular basis.

It may be helpful to reestablish credit when possible, but be very careful with big-ticket purchases that have little or no resale value.  In other words, buying a good used car on a monthly plan is preferred by lenders over consumers buying plasma TVs.  The car has a greater resale value and can be easily sold if you hit a hard spot. A plasma TV might be entertaining, but loses a  large percentage of its value the moment you walk out of the store.

In general, use the old adage: “If the blanket isn’t long enough, don’t stretch it out so far.”  Use layaway plans instead of paying high fees and interest rates on sub-standard credit cards.  Over time, fewer purchases paid on time is more impressive than a large debt poorly serviced. The sooner you show your ability to make and keep commitments, the sooner your bankruptcy will be behind you.

Read More on Bankruptcy Myths

Overall, most people will face a 3-5 year journey out of bankruptcy. It can be shortened by an individual commitment to making payments on time and keeping an eagle eye on their credit reports. Once out of the bind you found yourself in, pat yourself on the back and commit to never going back to the courts for relief!

Want more help on Bankruptcy in your area? Contact the Advantage Legal Group for all mortgage modification and foreclosure assistance. Advantage Legal Group is your source for helping you file bankruptcy and then recouping and planning for the future. Call us for Mortgage Mediation and all questions regarding foreclosures and bankruptcy.

 

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How to Say Goodbye to Renting and Hello to Buying

New Therapy May Help with Mortgage Defaults

Are All Debts Forgiven in Bankruptcy?

Are All Debts Forgiven in Bankruptcy?

Are All Debts Forgiven in Bankruptcy?

Bankruptcy is a very useful thing that can help many people and give them a fresh start in their financial lives. Many debts can be discharged in bankruptcy. However, there are sometimes exceptions. Debts that are commonly discharged in bankruptcy include things such as:

  • -credit cards or unsecured loans
  • -car repos and deficiency balances
  • -SOME car accidents
  • -material supplier debts
  • -medical bills
  • -lawsuits and judgments
  • -evictions and unpaid rent
  • -unpaid utility bills
  • -foreclosure balances

There are exceptions, however, to the above standard discharges covered by going bankrupt. The following are four different examples of these exceptions:

Excessive credit card use immediately leading up to the bankruptcy. If you go on a major credit spree just before filing for bankruptcy, you may have troubles. The creditor may challenge your request claiming you never intended to pay for those items. If this happens your entire balance MAY NOT be discharged.

Being under the influence of drugs or alcohol when you cause an accident or maliciously or willfully causing an accident. Debts under these kinds of circumstances cannot be eliminated.

In the case of money owed to suppliers, if you STILL have material that the supplier can recover and resell, you have to return it. You don’t get to keep it, eliminate your debt and then resell the material for your own profit.

Committing fraud when you’re sued may prevent debts from judgments against you from being discharged.

More: How to get your credit on track for 2020

The aforementioned debts are the most common types included in bankruptcy petitions. It should be noted that each case is unique and has its own set of circumstances. Therefore you should always consult an attorney concerning your particular debts as well as do your own personal research.

See also:

Should I File Bankruptcy?

Bankruptcy and Divorce

What Can I Keep After Bankruptcy?

 

How Do I Start a Bankruptcy?

How Do I Start a Bankruptcy?

Where do you start if you are considering bankruptcy?

Reality has changed for millions of people over the last few years. Even though the housing market has recovered nicely, for some, this reality is not in their favor.  If you feel overwhelmed by a mountain of debt and can’t see your way out of the situation. It might be time to consider filing for bankruptcy.

Filing bankruptcy is a serious matter. You should get financial counseling before you take this step, but if you have no other option, the process can protect you from harassment.  It is pretty straight forward.  Over time, if you are careful, you will have a chance to rebuild your credit.

Once you have researched your options and concluded that bankruptcy is the best way forward, make sure that you understand the process before you begin filing so that at any point along the way you will know what steps are next.

How Do I Start a Bankruptcy?

The first step in filing bankruptcy is to determine what you owe to each lender. You can do this by obtaining a copy of your free credit report from each of the three major reporting agencies: Equifax, Experian and TransUnion. This will provide you with the most recent records of your debts and will play an important part in ensuring that you properly proceed.

Next, visit the U.S. Courts Bankruptcy website.  Here you can find information regarding the type of bankruptcy you will need to file. Generally, you will file under chapter 7 or chapter 13.  When you understand the differences you are ready for step 3.

You will probably want to obtain an attorney who specializes in bankruptcy in your area.  This is always recommended because his/her expertise can help you make your way through the often confusing process of bankruptcy.  They can also advise you on how to get creditors off your back while you are moving ahead.

Locate a bankruptcy attorney in your area. Although an attorney is not required to file for bankruptcy, it is highly encouraged that consumers use a knowledgeable bankruptcy attorney. The bankruptcy process is not clear-cut and it is important to have an experienced professional on your side. The e-bk website maintains a lawyer directory that will help you in your search for an attorney to help you with filing your bankruptcy.

Once you have your records in place, meet the attorney in person. If you are married or have a partner, bring them along and talk about the right process for your bankruptcy. This will also mean taking a Means Test that will determine whether you file for chapter 7 or chapter 13 bankruptcy. Once your path is set, the attorney will file a petition on your behalf. The entire process can be quite lengthy, but once the petition is filed with the court, you are well on your way to a new beginning.

Filing bankruptcy in Western Washington should never be your first step in finding debt relief, but if you have exhausted your other options and still find yourself unable to meet your debt obligations, bankruptcy can help you move forward toward a better future.

Contact Advantage Legal Group for more information on Western Washington bankruptcy.

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